Seattle mayor’s staff leaning toward Leiweke’s KeyArena proposal

Seattle Mayor Ed Murray’s staff is expected to recommend the KeyArena proposal backed by Tim Leiweke and the Oak View Group and the mayor’s decision on the proposal could come in early June, sources close to the bidding process have said.

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The Oak View Group arena proposal — a $564 million restoration of the existing KeyArena building that would be retrofitted for professional hockey and basketball — is one of the two pitches submitted for the Seattle Center arena that are under consideration by the mayor. Murray announced two weeks ago that he would not seek re-election but has made it clear he is not leaving the arena decision to whoever becomes the next mayor of Seattle.

A third proposal, backed by hedge fund manager Chris Hansen, seeks to build a new, privately funded $550 million arena in the existing stadium district — a plan opposed by the Port of Seattle. Murray has been lukewarm to the SoDo proposal, saying that he doubts Hansen has the pull to bring a professional basketball or hockey team to Seattle.

What puts the Leiweke/Oak View proposal out front, sources said, is its lack of need for public money or subsidies, and a rumored inside track to an NHL franchise. By contrast, the less-expensive, $520 million proposal from Seattle Partners includes an undisclosed amount of public financing — a financial and political liability from the city staff perspective. Seattle Partners also has close ties to the NHL and is backed by Bob Newman of Anschutz Entertainment Group — the current marketing manager of KeyArena — but sources said mostly a single factor is Seattle Partners’ prime asset: Communications specialist Roger Nyhus.

Nyhus and Murray have a longstanding professional relationship and remain close friends. Before dropping out of the race for a second term following an allegation of sexual abuse, Murray held his 2016 campaign kick-off fundraiser and Nyhus’ Capitol Hill home. Murray did the same for his first run at Seattle Mayor in 2013. Early in the arena bid process, Seattle Partners hired Nyhus’ communication firm in an effort to secure a direct channel to Murray.

Even so, staff is leaning toward the Oak View proposal. And it’s not clear at this point which bid Murray favors.

Wither Chris Hansen and SoDo?

Hansen’s proposal, by many accounts in City Hall, appears nearly dead. Last year, he failed to get city council approval on his initial proposal that required $200 million in public funding and the vacation — essentially acquisition for development purposes —  of a stretch of Occidental Avenue near the existing stadiums. And the Port of Seattle came out aggressively against the project (while backing the concept of rehabilitating KeyArena).

Since then, Hansen has crafted a new proposal with the public money replaced by private financing and enlisted Seahawks quarterback Russell Wilson as a partner. But the project still requires the stretch of Occidental and there’s nothing to indicate that any future council vote would turn out differently than the prior one. Privately, Murray is said to not like Hansen — a sentiment rumored to be shared in some NBA circles after his failed attempt to land the Sacramento Kings.

But the 49-year-old Hansen might still be in for a fabulous parting gift from the city.

Little watched or publicized is Seattle’s Industrial Lands Advisory Panel. The group, formed nine months ago by the mayor’s Office of Economic Development, is helping to script the future of the city’s industrial-zoned lands: those around the stadium — including the parcels owned by Hansen —  and south into Georgetown (called the Duwamish Manufacturing/Industrial Center) and those that cut along the waterfront and through Interbay, Fisherman’s Terminal and into south Ballard.

The 27-member panel includes Seattle City Councilmember Rob Johnson; Port Commissioner John Creighton; Roger Bialous, of Georgetown Brewing; Dave Gering, the executive director of the Manufacturing Industrial Council; and Seattle Storm owner Ginny Gilder.

Also on the panel? Hansen’s arena project attorney Jack McCullough, of McCullough Hill Leary.

The group is nearing completion of a draft for an Industrial Lands Economic Study. Not yet released to the public, the draft study is an inventory of the parcels, jobs, businesses and vacant lots in the city’s remaining industrial areas. For example, it notes that the industrial areas in the city create 106,000 jobs. And it is this document — thus far negotiated in private meetings — that will help eventually determine which lands stay industrial and which could be opened up for other forms of commercial or even residential development.

Hansen’s land — stretching to the south edge of the Safeco Field — is considered square in the mix of industrial land that could be rezoned as commercial, which would open it up for the hotel and entertainment venues he wanted — minus the stadium he sought.

Noted one person close to the process who asked to remain anonymous, “That might keep him happy and quiet so the city can focus on Seattle Center.”

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